Illinois remains a wasteland

Taxpayers pay high price when governments lose their way

March 12, 2012|Phil Rosenthal

Gov. Pat Quinn named State Rep. Julie Hamos director of the Illinois Department of Healthcare and Family Services in April 2010. A state report last week harshly criticized the agency for the way contracts were awarded to provide health insurance for state workers, retirees and their families. (William DeShazer, Chicago Tribune)

Even if you suspected our cash-strapped state and local governments had lost their way, you wouldn't expect GPS to show how far off course they veered.

Yet there's Chicago's Department of Aviation shelling out for locater services on 53 vehicles and 155 cellphones, ostensibly to improve its operations. Unfortunately, the GPS services were used on only about 30 percent of the souped-up phones and vehicles, representing a waste of least $171,000 over four years, the city's inspector general reported.

With so many people and businesses concerned about the tax climate and budget shortfalls that jeopardize the quality of life and commercial stability, throwing away tens of thousands of dollars on tracking services that don't work or aren't worth turning on is waste and stupidity that Illinoisans, already paying a hefty price for political corruption, can't afford.

"Campaign contributions, where it looks like votes and deals are bought and sold, people get angry about that kind of corruption," said Emily Miller, policy and government affairs coordinator for the Better Government Association. "But procurement and these long, drawn-out processes that nobody has any idea of how they work, that's (also) where money is wasted."

A recent University of Illinois at Chicago study estimated political corruption costs state taxpayers no less than $500 million a year. Even if it fails to reach the level of criminal misconduct, the cost of fiscal missteps and Keystone Kops-style oversight –— a corrupted process, if you will — are beyond the means of a state nursing a sizable budget deficit and vast unpaid obligations.

"Procurement is not sexy, but procurement is the heart and soul of corruption," Miller said. "That is where it continues to be bred and it lives and thrives."

The day before the inspector general's report on the Aviation Department's wrong turns on GPS, Illinois' auditor general torched the Department of Healthcare and Family Services and the Executive Ethics Commission for "serious deficiencies" in a process that awarded three contracts worth $7 billion to provide health insurance for state workers, retirees and their family members. One result was that it's difficult to know if the state got a good deal on the insurance.

Ironically, some of the problems cited stem from confusion about rules, responsibilities and requirements of revamped purchasing laws established to prevent the sort of corruption that thrived during former Gov. Rod Blagojevich's administration.

"This was supposed to be the fix, and now all this waste happened after the fact," Miller said.

"It does seem to be verging on incompetence in this case, unless they find a direct so-and-so gave money to so-and-so for the contract, which is what we find in the corruption reports, like the Blagojevich contracts," said Dick Simpson, a former Chicago alderman who's a UIC political science professor and co-author of the school's "Chicago and Illinois, Leading the Pack in Corruption" report last month. "The thing about waste and inefficiency is they're mostly out of sight."

The Office of the Auditor General's 169-page report on the state insurance deal set off a wave of finger-pointing and finger-wagging.

Among the audit's findings: The state agencies signed off on a deal that allowed a consulting firm to help review the bids despite business relationships with each of the bidders. An original recommendation to award the contract was changed after an agency head met with the governor's office. One insurer scored a contract in 20 counties in which it did not bid and in 24 counties where it had no in-network primary-care physicians. And finally, all of this should have been flagged before the deals were done. All of this should have been flagged before the deals were done, according to the report.

"Everybody is saying, 'It's not my fault.' Everybody is pointing the finger at everybody else," Miller said. "This system of checks and balances, if the checks aren't actually checking and there's no balance, then the auditor finds the problem after the fact. … Checks and balances don't work unless everyone does their job. Once the deal goes through, the taxpayer money is already wasted. We have to make sure this stuff is caught on the front end, so we prevent the taxpayer money from going down the drain."

Miller is sympathetic to a degree. The state's procurement code runs 130 pages or so, and then each department has its own rules for how the code is to be implemented. Then the ethics people have their own set of responsibilities in relation to the procurement code.

"These are the kinds of stories that give people a reason to say government doesn't work," she said. "That's unfortunate, because one of the other things this story shows is the government has tremendous bargaining power.